Time Warner’s Warner Bros.
Time Warner’s (TWX) Warner Bros. could benefit from its movies moving from theaters to on-demand streaming quicker, which could open up a new revenue stream for the company. Between 2016 and 2020, Time Warner (TWX) expects to release about 17 movies from its DC Extended Universe, Lego, and World of Harry Potter franchises. In 2017, Warner Bros. expects to release two movies from the DC franchise.
Time Warner also expects growth in Warner Bros.’s adjusted operating income to be driven mainly by growth in its theatrical distribution and video game businesses. The company also believes that, considering Warner Bros.’s vast library of content and its ability to generate all types of content, Warner Bros. could stand to win when it comes to bidding for its content.
As the chart above shows, Warner Bros. comprised 43% of Time Warner’s total revenues of $29.3 billion in fiscal 2016.
Time Warner is bullish about television
According to a report from The Hollywood Reporter, Warner Bros. has planned for a premium video on demand service priced at $50 that could provide movies for viewing 17 days after their theatrical release.
Time Warner also expects a slowdown in production of television programming for broadcast television networks. The company explained that earlier, there was a limit to how much content Warner Bros. could sell to television networks like CBS (CBS).
The sale of television content currently involves selling to premium television networks, video streaming services like Netflix (NFLX), and international streaming services. Time Warner stated that it sees an opportunity in producing content for premium television networks and streaming operators like Netflix.